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3/14/2012
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iPad Mini Rumors Resurface

An unnamed Samsung source in a Korean report claims that Apple will be releasing an iPad with a smaller screen by the end of this year. There's clearly a market for such a tablet, but does Apple want to enter that market?

Rumors of a smaller iPad, the so-called iPad Mini, have resurfaced. They first started swirling late last year during the usual speculation surrounding an Apple iPad release. In February, one of Apple's suppliers said it was shown models of a smaller iPad with a screen approximately 8 inches.

When Apple CEO Tim Cook introduced the new iPad on March 7 he gave no hint about a Mini. The only surprise was Apple's decision to continue the iPad 2 and drop the price by $100, starting at $399.

Then last Sunday, a Samsung official spoke to the Korean Times about how Apple's good fortune has become Samsung's good fortune. Samsung makes many of the components for the iPad, such as the new LTE chips. Cook has told Samsung that Apple is committed to buying from it until 2014. The Samsung official, who didn't give his name, said in 2011 Apple purchased between $7.8 and $9 billion worth of components and he expects that number to jump to "$11 billion by the end of this year as Apple is planning to release a smaller iPad, probably with a 7.85-inch screen..."

That is just about two inches shorter than the 9.7-inch display on the iPad, approximating the same dimensions as the Nook Color and the Kindle Fire. But from there it's anyone's guess.

Of course this might be nothing but rumor and Apple could simply be building samples. That's what BYTE's Jacob Lopez told me. "Apple may not be planning a smaller iPad," said Lopez. "They may be, or may have been at one time, prototyping and playing with the idea and someone opened their big mouth."

There is a market for a smaller tablet, though. Barnes & Noble and Amazon have proven that. The release of the Kindle Fire--as successful as it was--didn't dent sales of the iPad at all because they're designed for different markets, but an iPad Mini could hurt Kindle Fire sales. The Fire and Nook Color are proprietary e-readers so their books cannot be shared across platforms, and their ecosystems are years behind Apple's. An iPad Mini, if there is one, would display iBooks, but it would also run the Kindle and Nook readers as well.

It's not unusual for Apple to sell multiple versions of the same product. The iPod Nano, Shuffle, and Touch have all sold side by side. Apple already has two iPads on the market, so with a smaller unit it would actually be selling four touch screens: the iPod Touch/iPhone, the Mini, the iPad 2, and New iPad. An iPad Mini priced at $299 would create a balanced pricing structure:

iPod Touch$199
iPad Mini$299
Pad 2$399
New iPad$499

Though Apple might be eyeing the market of the Kindle Fire, a smaller, less expensive iPad could solve another problem: home automation. Apple first mentioned an interest in home automation in June 2010. But aside from some integration of the TV and DVR, the average house still is not "connected."

An iPad Mini could run the household, acting as a central hub for AppleTV, music, speakers, and the thermostat, as well as checking email, getting a recipe, or even reading a book. Where a full-blown iPad would be overkill for the job, an 8-inch iPad with a reduced price would be just right. Also, the iPad often goes out the door with someone to work or school. The Mini would stay home. Now throw in Siri and you could change the temperature of the house or find out what's on HBO just by asking.

The potential for an iPad Mini is vast. How Apple sees it we won't know for some time.

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